cbdMD, Inc. Files 8-K for Equity Sale

TL;DR

cbdMD filed an 8-K for unregistered equity sales on 8/23.

AI Summary

On August 23, 2024, cbdMD, Inc. entered into a Material Definitive Agreement related to the unregistered sale of equity securities. The company, formerly known as Level Brands, Inc., is incorporated in North Carolina and has its fiscal year end on September 30.

Why It Matters

This filing indicates a significant transaction involving the sale of equity securities, which could impact the company's capital structure and shareholder value.

Risk Assessment

Risk Level: medium — Unregistered sales of equity securities can sometimes indicate financial distress or a need for capital, which carries inherent risks.

Key Numbers

• 001-38299 — Commission File Number (cbdMD, Inc.'s SEC filing identifier)
• 47-3414576 — IRS Employer Identification No. (cbdMD, Inc.'s tax identification number)

Key Players & Entities

• cbdMD, Inc. (company) — Registrant
• Level Brands, Inc. (company) — Former Company Name
• August 23, 2024 (date) — Date of earliest event reported
• North Carolina (jurisdiction) — State of Incorporation

FAQ

Key Financial Figures

• $100,000 — he Majik Claims. The Company paid Majik $100,000 on the date of the Purchase Agreement a
• $50,000 — Purchase Agreement and shall pay Majik $50,000 on each one-year anniversary of the Pur

Filing Documents

• ycbd20240823_8k.htm (8-K) — 29KB
• 0001437749-24-027959.txt ( ) — 176KB
• ycbd-20240823.xsd (EX-101.SCH) — 4KB
• ycbd-20240823_def.xml (EX-101.DEF) — 13KB
• ycbd-20240823_lab.xml (EX-101.LAB) — 17KB
• ycbd-20240823_pre.xml (EX-101.PRE) — 13KB
• ycbd20240823_8k_htm.xml (XML) — 5KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement. On August 23, 2024 (the "Effective Date"), cbdMD, Inc. (the "Company") entered into an Amendment (the "Amendment"), to amend (i) its outstanding 8% Senior Secured Original Issue 20% Discount Convertible Promissory Notes with an original issuance date of January 30, 2024 (each a "Note" and collectively, the "Notes"), issued by the Company to five institutional investors (the "Holders") and (ii) the Security Agreement entered into by and between the Company and the Holders dated January 30, 2024 (the "Security Agreement"). As previously disclosed, the Company's wholly owned subsidiary, CBD Industries, LLC ("CBD Industries"), filed a cancellation proceeding before the U.S. Patent and Trademark Office Trademark Trial and Appeal Board (TTAB) against Majik Medicine, LLC ("Majik"), in April 2019 to cancel Majik's issued supplemental register trademark for "CBD MD" (the "Limited Mark") on multiple grounds and Majik filed certain counter claims under a matter pending in United States District Court for the Western District of North Carolina (the "Majik Claims"). On the Effective Date the Company and CBD Industries entered into a Settlement, Purchase and Release Agreement with Majik (the "Purchase Agreement") and acquired the Limited Mark in consideration of the payments described below and the Company and Majik agreed to jointly execute and file a voluntary dismissal with prejudice for the proceedings relating to the Majik Claims. Furthermore, upon execution of the Purchase Agreement each party released the other from all claims relating to the Majik Claims. The Company paid Majik $100,000 on the date of the Purchase Agreement and shall pay Majik $50,000 on each one-year anniversary of the Purchase Agreement for a period of four years (the "Additional Payments"). In the event the Company fails to make an Additional Payment, the Limited Mark shall be reassigned to Majik. The Company also issued Majik 75,000 shares of co

02 Unregistered Sales of Equity Securities

Item 3.02 Unregistered Sales of Equity Securities. The information contained above under Item 1.01, to the extent applicable, is hereby incorporated by reference herein. The transaction was exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended.

Forward-Looking Statements

Forward-Looking Statements This Form 8-K includes forward-looking statements related to the positive potential to the Company from entering into the Consulting Agreement and the Company ' s beliefs regarding the benefits of securing the Limited Marks. Specific forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. These forward-looking statements are based on management ' s current intent, belief, expectations, estimates and projections regarding the Company and the industry in which it operates. These statements are not guarantees of future performance and involve risks, uncertainties, assumptions and other factors that are difficult to predict. Therefore, actual results may vary materially from what is expressed in or indicated by the forward-looking statements. Factors that may cause actual results to vary materially include those listed in the Company ' Form 10-K for the year ended September 30, 2023, as well as the wholesale customer base not accepting our products, consumers hesitation to change, and our inability to meet the requirements under the Consulting Agreement.

SIGNATURES

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. cbdMD, Inc. Date: August 28, 2024 By: /s/ T. Ronan Kennedy Name: T. Ronan Kennedy Title: Chief Executive Officer and Chief Financial Officer

View Full Filing

View this 8-K filing on SEC EDGAR